Libor fraud, shipping litigation, aircraft finance. This and more is on offer at this internationally minded City firm.
While shipping is still one of SH's strong suits (just look at the Chambers UK rankings), "the firm is also strong in a number of other transport sectors, such as aviation and rail," says training partner Neil Noble. For example, it advised Hitachi Rail on its bid to manufacture and maintain the new Crossrail trains, and it counselled Vietjet Air on its £480m purchase of 46 aircraft engines. The firm also attracts high Chambers UK rankings for areas as diverse as capital markets, civil fraud and commercial contracts.
International work is very important to Stephenson Harwood. It was one of the first UK firms to venture into Asia – opening a Hong Kong office in 1979 – and expansion in East and Southeast Asia has continued since: the firm now sports outposts in Beijing, Hong Kong, Shanghai and Singapore (a Guangzhou office shut up shop in 2014). The region is a major market for the firm with 25% of staff based there, while a whopping 60% of fee income is generated from clients based outside the UK. There are also offices in Paris, Dubai and Piraeus. And overseas growth is continuing, with a new office in Seoul now in the pipeline. This move came in the wake of the firm striking up alliances with local outfits in Singapore and Myanmar. A look at the rankings in Chambers Europe, Chambers Asia-Pacific and Chambers Global shows that the overseas offices all perform pretty well in their respective markets, especially in the fields of shipping and aviation.
The current strategy of overseas expansion and practice diversification appears to be working very well. The firm has enjoyed five straight years of revenue growth since 2008, with income reaching £121m in 2013/14, up an impressive 40% from the 2008/09 figure.
Before arriving, prospective trainees are asked to list three broad departments they would like to sit in first, in order of preference. At later rotations, trainees are able to specify a more narrow sub-group they wish to join. According to interviewees: “Most people tend to get their first or second choice.” Sources also told us that: “Commercial litigation is really popular due to its excellent clients – lots of people want to qualify into the department too.” Three trainees are able to sit with the team at any one time and it took in four NQs in 2014. Overall 13 of 17 qualifiers stayed with the firm.
The MIT (marine and international trade) department works on all manner of contractual and insurance-related shipping and trade disputes, as well as non-contentious contractual issues. Recently SH defended RSA Global – a large Dutch marine insurer – against a range of claims related to salvage, pollution and repairs originating from a collision off the Chinese coast. Almost all of the work is international and multi-jurisdictional. For example, the London and Singapore offices recently acted for Dutch geo-surveyors Fugro in a dispute over the cancellation of a construction contract for a £71m survey vessel. Arbitration of disputes is increasingly popular: “Rather than going straight to trial, many of our clients now prefer using international arbitration because it's cheaper and more discreet.” On the non-contentious side trainees undertake work “drafting and updating insurance companies' contracts and terms and conditions.”
A seat in finance is a varied affair, with the department undertaking asset finance involving shipping, aviation and rail transactions, as well as property finance and some corporate finance. Trainees' work tends to mirror their supervisor's sector specialism. While there are administrative tasks like arranging notarial services and organising conditions precedent, one source had “drafted all ten security documents for one transaction,” while another said “there are plenty of chances to meet with clients, especially at closing meetings.” Asset finance lawyers act for lenders including many overseas banks, as well as aircraft leasing companies and “airlines ordering huge numbers of new planes.” Finance is known for its “driven, high-pressure” environment and “punishing” hours. While in litigation you might finish at 7 or 8pm, finance is more likely to keep you until 9pm or 9.30pm if there's a deal brewing. One trainee cautioned: “I knew in advance that the hours would be intense, but they were a lot more challenging to deal with in real life than I'd expected. I didn't anticipate the stamina required.”
The commercial litigation team has been involved in some topical financial cases recently, including the Libor and Forex rate-fixing scandals. The firm “often acts for senior individuals who are under investigation by the FCA or SFO”– these include Brent Davies, a broker alleged to have conspired with UBS employees to fix Libor, and Chris Ashton, former chief foreign exchange dealer at Barclays, who is currently under investigation for conspiring in online chat rooms to fix the Forex rate. The department also takes on more commercial matters: it was recently brought in to replace Shearman & Sterling by property tycoon Robert Tchenguiz who is suing the Serious Fraud Office for £300m in damages in relation to dawn raids carried out in reaction to the collapse of the Icelandic banks.
Trainees sitting in litigation have the opportunity “to get deeply immersed in a few major cases.” One interviewee who'd been working on a “big defamation case” told us they had “drafted witness statements, attended client meetings, sat in on conference calls, and drafted instructions to counsel.” Another trainee was sat with a partner whose practice focused on Africa and was heavily involved in arbitrations involving various African governments. In the course of this they “proofread transcripts, drafted witness statements, corresponded with counsel and worked on affidavits.” Trainees noted that “because of the size of the cases you generally get less responsibility in litigation than in other departments.”
The real estate team's assignments are often finance-related. For example, the firm recently represented HSBC and Deutsche Postbank on a £54m development near King's Cross. The department's clients are a varied bunch though: they include the University of Greenwich, which SH assisted with the £40m construction of a 358-bed student accommodation block, and Native Land, which lawyers helped with the £201m acquisition and redevelopment of the former site of Holland Park School. On larger transactions trainees are tasked with “research, compiling lease summaries, making applications to the Land Registry and carrying out due diligence.” To thrive you have to be adept at multi-tasking, with one trainee informing us that they “had about 30 matters on the go at one time!” There is a run-up of “three to four months” before you'll be handling this volume of work, and by then “your supervisor will only give things a cursory glance every now and then, so you really feel like they trust you.”
At every seat rotation trainees have the opportunity to head out to Hong Kong, Dubai or Singapore, apart from the first seat. Each office hosts one or two trainees at a time and offer a corporate/finance-focused experience with plenty of shipping and aviation work thrown in. The work involves “liaising regularly with local clients – usually airlines or leasing companies.” Those clients include Lion Air and the Industrial and Commercial Bank of China's leasing arm. Trainees who'd been abroad told us they had “conducted closing calls independently” and “worked with SH lawyers all around the world.” One source did note that “doing aviation finance work, I found that a lot of the aircraft are due to be delivered to places like Paris or Hamburg, so we had to work to European time. That meant deals often closed as late as 4am.” While the Singapore office in particular has “a bad rep for its long hours,” trainees did appreciate the “very nice apartments” the firm puts them up in and the opportunity to take holiday while in the region and travel to some of Southeast Asia's tourist hotspots. There's also the chance to meet, befriend and socialise with trainees from other firms which send people out to Singapore or Hong Kong.
Back in London, the highlight of SH's social calendar – and “the only event which brings together the entire firm” – is the black-tie Christmas dinner, which in 2013 was held at The Brewery in Moorgate. Future trainees are invited too and the evening is “a great networking opportunity and really makes future joiners feel like part of the firm already.” The trainee group also enjoys “meeting for casual drinks on Thursdays and Fridays – though whether you can make it depends on your workload.”
Trainees felt that they work in a “very supportive environment,” noting that “supervisors are well chosen.” As one put it: “No one has jumped down my throat... yet!” People tend to be of the approachable sort and “there are few who give off a 'steer-clear' vibe,” although “occasionally when people are busy and stressed they might have less time to explain everything like they usually would.” Trainees are encouraged to ask questions and to seek clarification; mistakes are tolerated as an inevitable part of the learning curve, “so long as you learn from your errors and don't make them again.”
Stephenson Harwood moved into new offices on Finsbury Circus in 2011. That, combined with the firm's growth and drive to expand internationally, has, according to some, affected the atmosphere at the firm. One trainee believed: “It hasn't eroded our friendly and collegial culture, but it has perhaps made everyone a bit more purposeful and formal.” One of the ways the firm is addressing its newfound larger size is by organising networking events. Trainees and NQs even run one themselves. One interviewee explained: “We're asked to invite peers from other organisations and SH lays on wine and nibbles.” The idea is to get trainees used to the idea of networking and making connections in the industry. “Usually it's the partners and senior associates who get to go off to do the schmoozing, wining and dining of potential clients, so it's great to get that opportunity as a trainee too!”
Sign up here if you're looking for a training contract with an interesting mix of litigation, fraud, shipping and finance work at “a firm with a lot of clout.”
Vacation scheme deadline: 2 November 2014 (winter); 31 January 2015 (spring and summer)
Training contract deadline: 31 July 2015
ApplicationsIn 2014 Stephenson Harwood received 900 applications for its vacation scheme and another 600 direct training contract applications.
Both types of applications begin with the same online form, which asks candidates to list their academic credentials and work experience. According to HR manager Sarah Jackson, “non-legal work experience can be useful as well as legal experience – roles in a different industry can allow people to develop transferable skills and provide a valuable insight into a commercial organisation.” She goes on to say that “applicants must be able to explain their interest in a career as a solicitor, and Stephenson Harwood specifically. We want to see that they've done their research and have thought about what life as a lawyer involves.”
Tests and assessment day
Around 250 applicants make it past the screening stage, and are asked to take a few pass/fail numerical and verbal reasoning tests.The next stage is a 45-minute interview with a member of HR that involves a mix of competency-based questions and enquiries into a candidate's background and experience. This is the final step for vac scheme hopefuls; meanwhile, around 30 direct training contract applicants are invited to an assessment day. This kicks off with presentations from each candidate on a commercial issue of their choice, followed by a Q&A with assessors. Then there's a 45-minute to one-hour partner interview, which sees applicants given a commercial scenario to analyse before presenting their findings.
Jackson tells us: “We're looking for applicants who demonstrate intellect, good analytical skills and sound judgement, good verbal and written communications skills, drive and determination, and have an appreciation of the bigger picture.”
The vacation scheme
SH runs five vac schemes: a week-long placement in the winter, a two-week scheme in April, and three two-week placements over June and July. There's room for eight candidates on each, and participants are automatically considered for a training contract.
Each attendee is allocated a partner or associate supervisor, plus a trainee buddy they can approach for help or with questions. Alongside their departmental tasks, vac schemers attend practice area presentations and strategy talks, and they carry out the aforementioned assessment day tasks.
The firm takes these assessments into account when deciding who gets a training contract offer, as well as feedback from candidates' supervisors and buddies. “We ask about their input into tasks especially,” Jackson says. “I think enthusiasm goes a long way – we always remember the people who get stuck in and were always offering to help out with things. We're always impressed by those who ask thoughtful and considered questions.”
The number of vac schemers who receive training contract offers “really varies year by year,” Jackson says, adding that the firm doesn't prioritise vac schemers over other applicants. “We will make an offer to an outstanding candidate whether he or she has completed a placement or not.”
Student Guide: What recent firm developments can you share with us?
Neil Noble: Our new Seoul office has opened this year. The new office will enable Stephenson Harwood to develop its existing Korea practice, where the firm acts for some of the largest conglomerates across shipping, shipbuilding and ship finance work, banking, and trade sectors.
The Dubai office opened the previous year, and it has now really got going. It's really grown from literally nothing and has now increased in terms of the numbers of personnel quite significantly. We've seconded a trainee out there for the first time this September.
Back in London, the finance group has seen significant growth, particularly in the rail team. We have brought in three rail specialist partners, alongside the one we already had. This is a significant step in the establishment and expansion of the team. Last year the team won the rail finance firm of the year award at the Global Transport Finance Awards. It's great to see the team recognised by the industry.
The rail team is a real example of the way that our sector focus has evolved. Our focus has to now be described as transportation. In the past we have been defined narrowly as a shipping firm, but now we have a much more diverse transport offering. Aviation, which we've worked in for some time, has been consolidated.
Partly this has been a strategic decision, as the shipping market has faced tough times in the last four or five years. Bank lending is down, and fewer ships are being built, which all affects our business. Having a spread of expertise is important so we are able to move resources around to the areas where they are best employed and keep trainees occupied.
SG: What would you say makes Stephenson Harwood stand out from other similar-sized City firms?
NN: Stephenson Harwood is a very well-balanced firm. Broadly speaking, there is a 50/50 split between the litigious and transactional sides. Then within those, the groups are all evenly weighted. We cover all the major areas that trainees might want to experience. They will always have plenty of variety. Unlike many other firms, we are not heavily biased in any way – no one group or sector dominates.
Having said that, within those disciplines we are very sector-focused. We work for transportation clients, financial institutions etc across the board – the tax department will deal with a bank's taxes, employment will handle their personnel needs, the finance team will help them advance loans and so forth.
Of course, not all firms can claim to have the international dimension. A quarter of our staff are now working overseas, mainly in the Far East. Everyone has the chance to work abroad as trainee or sometimes as an associate. This is the obvious international dimension. Less obvious perhaps is the fact that around 60% of our fee income now comes from outside the UK. Sizeable parts of our practice do no UK work at all. Even if a client is based in the UK, often the companies will be Chinese or German, for example, and we'll be dealing with the UK subsidiary.
SG: What do you look for when recruiting trainees?
NN: There is no one-size-fits-all model here; we have a mix of practices, and those need a mix of people. During the selection process, we're at pains to emphasise that it's good to have different people. Although we want a model candidate, we also want people who are a bit different.
We like it when people come to us with an entrepreneurial spark – perhaps they've run little ventures or businesses on the side of their studies. Or they might display a view of the world beyond academics and have their own views and opinions on the business world. In the future they can then sit down and know how to fill a blank sheet with a business plan. We like people who have an appetite to do things for themselves.
SG: Some of our trainee sources felt the qualification process is slightly more formal and lengthy than necessary. Can you explain why you take this approach?
NN: We always view the process as an opportunity to round up all the things a trainee has done and pull them all together. It's a two-year interview, really, and at the end we bring together all the appraisals and anything else we feel is relevant. When someone comes to us and says they want to join a group, we already have a pretty advanced opinion on them. In my view, the interview is not definitive.
It's a chance for candidates to interview us as well. Often there are two or three people who are interested in several departments and we have to fight with other groups to get the best trainees. It's a two-way process and a very important decision. It's a great opportunity to have a full and frank discussion and asks the big, important questions that no one generally asks, like 'What is it you enjoy about your work?'
Inevitably it will be a daunting time as it is a big decision, and there's the possibility you might have to leave. Most lawyers only expect to move two or three times in their career, so it's bound to be scary.
SG: The firm has recently made several secretaries redundant as certain functions are now outsourced. Is this something we can expect will be more of in the future?
NN: The business rationale behind this is common, and lots of firms are currently doing the same. A significant amount of the work the secretaries were undertaking was just typing. It doesn't matter if that happens ten paces or 1,000 miles away; in terms of pure mechanics they were delivering a service that could be done remotely. The role of secretaries has changed dramatically over the years; they're now better trained and educated, and provide general support rather than just typing, so the change was inevitable.
Any business is hamstrung by employment law. There have to be consultations over a period of time, and minimum periods have to be observed. This stretches a difficult situation over a long time, and it becomes difficult on a personal level. Unfortunately no one wins. It's been relatively painless in terms of the transition; the majority have stayed. They work for more people now, and the amount of typing has been reduced. The lawyers were unsure at first, but now that the change has happened and it works, they're more comfortable.
SG: Do you have any advice for readers planning to apply for a training contract at Stephenson Harwood?
NN: One thing I would emphasise is that the best way of learning is doing. We throw trainees into the work immediately, giving them real-life cases and transactions. They're working with clients, drafting documents, communicating in meetings by email and telephone. This is their evolution to becoming an associate. It's a curve, not a jump. We don't teach, but we allow trainees to watch us, and if they do something wrong they'll learn from it.
My top tip would be that no question is a stupid question. We would much rather you get it right than show initiative but go in the wrong direction, as this could work against your confidence.
Trade sanctions have long been an important diplomatic tool in the arsenal of national governments. The United States in particular is known for enacting sanctions against countries – from Cuba to Iran – which have provoked its ire. Diminishing defence budgets and lack of public appetite for military intervention have led the US, along with the EU and various other nations, to impose sanctions on Syria, Egypt and Russia in recent years. Such sanctions can be imposed unilaterally by a single nation – as is the case with the US and Cuba – or by an international body on behalf of all its members – for example, the UN on Iraq and South Africa in the 1990s.
The aim of sanctions is usually to restrict the import or export of goods that might be used for military or terrorist purposes. Normal, legitimate trade is generally allowed to continue. The current situation in Syria demonstrates this: EU member states have the power to authorise derogations from the recently imposed sanctions under certain circumstances, provided they consult with the Syrian National Coalition for Opposition and Revolutionary Forces.
Sanctions are playing an increasingly big role in the practice of international trade law. Certain businesses – including those in the shipping, energy and infrastructure industries – have to keep abreast of current sanctions are in place and consider the effect potential future ones could have upon their existing relationships with businesses in targeted countries. As a result, international law firms like Stephenson Harwood, which has well-established international trade and shipping practices, are tasked with monitoring the rapidly changing diplomatic landscape that influences the imposition and relaxation of sanctions. They must also keep a close watch on the ways in which courts have responded to the effects of sanctions in various jurisdictions.
In 2013 Stephenson Harwood successfully represented the Iranian Melli Bank, which was subject to an asset freeze under newly implemented EU sanctions. At the time the asset freeze was put into place, the opposing party in the case, ship management services company Holbud, owed Melli Bank a commitment fee under a discount facility agreement. Holbud argued that the imposition of sanctions frustrated the contract, thereby freeing it from its obligation to pay. The judge rejected this argument, stating that Holbud should have applied to HM Treasury for licence permitting payments to be made pursuant to the discount facility agreement. Evidence demonstrated that such an application was likely to be granted, and as a result Holbud was ordered to pay Melli Bank the full amount claimed.
Stephenson Harwood LLP
1 Finsbury Circus,